Though five years into the Medicare Part D drug program, CMS' efforts to root out fraud and waste are still "limited in scope and may not sufficiently protect the program," a federal inspector told Congress on Wednesday.
"Lack of effective oversight exposes the Part D program and Medicare beneficiaries to a wide range of fraud, waste, and abuse, including inappropriate billings, payments for excluded drugs, drug diversion, improper bid submissions, excessive premiums, and illegal marketing schemes," Robert Vito, a regional inspector general for HHS, told the Senate Committee on Homeland Security and Governmental Affairs.
"The failure to address these vulnerabilities puts the scarce resources of the Medicare Trust Fund at risk," he added.
Medicare Part D was enacted in 2003, and operational by Jan. 1, 2006. Because of the "extremely short implementation schedule" of two years, Vito said CMS concentrated on "implementation activities, including the development of procedures, data systems, and infrastructure to carry out all the necessary functions."
Medicare Part D begins the current fiscal year with 27 million beneficiaries enrolled in the program, 17 million of whom are in stand-alone plans. Since the program's inception, Medicare has paid nearly $200 billion for the Part D program, Vito said.
Vito's office identified several problem areas:
The program was launched with limited safeguards. "CMS relied largely on complaints to identify potential fraud in Part D and not all of these complaints were investigated in a timely way. In addition, we found that no significant data analysis had been conducted specifically to detect or prevent fraud and abuse," Vito said.
Medicare Drug Integrity Contractors—MEDICs—monitoring Medicare Part D have identified most fraud though external sources, such as beneficiary complaints, rather than proactive methods. An OIG report in October noted that of the 4,194 potential fraud and abuse incidents that MEDICs identified in 2008, 87% were identified through external sources.
MEDICs complain of long delays and limited access to CMS data. "MEDICs also lack the authority to directly obtain information, such as prescriptions and medical records from pharmacies, pharmacy benefit managers, and physicians," Vito said.
Plan sponsors are supposed to have plans in place to identify fraud and abuse, but many did not meet CMS requirements, or contained only broad outlines. CMS has yet to finalize audits of plan sponsors' compliance plans.
Plan sponsors' efforts to identify fraud vary widely because the specifics of each plan's fraud identification program are left to each individual plan sponsor. OIG found that during the first six months of 2007, 90% of all fraud and abuse incidents were identified by only seven of 86 plan sponsors.
CMS' oversight of account payment accuracy is weak. The monthly payments that Medicare makes to plan sponsors for providing Part D coverage is based on estimates the sponsors provide in their approved bids, and include the sponsors' expected profits. "Inaccuracies in sponsors' bids have resulted in Medicare paying higher payments and beneficiaries paying higher premiums than they should have," Vito said.
Most Part D plans routinely overestimate their costs. In 2006, for example, Part D plans owed Medicare more than $4 billion. "We recommended that CMS ensure that sponsors' bids accurately reflect their costs of providing the benefit, and when sponsors fail to do so, that CMS hold sponsors more accountable for inaccuracies in the bids," Vito said.
CMS' Part D audits do not ensure accountability. The two audit mechanisms CMS has in place to ensure the accuracy of the bid—the bid audit and the financial audit—are largely ineffectual for detecting and correcting bid inaccuracies.
Vito offered the committee a handful of recommendations that he said would improve fraud identification and program accountability:
CMS should implement a comprehensive program integrity plan that includes specific action items, target dates, and assigned staff for follow up. It also is crucial that audits are conducted in a timely manner and that mechanisms are established to hold plan sponsors accountable for the problems identified.
CMS should improve oversight of MEDICs, including their analysis to detect fraud and abuse. MEDICs should be given the legal authority to obtain critical information directly from pharmacies, pharmacy benefit managers, and prescribing physicians.
CMS should ensure that plan sponsors are implementing effective compliance plans, so they can flag potentially fraudulent issues early on.
CMS, MEDICs, and plan sponsors need to perform innovative data analysis of claims and payment information, and embrace proactive methods of fraud detection.
At least a half-dozen House Democrats who voted against the healthcare bill say they are now undecided, and President Obama says he is willing to embrace several Republican ideas to collect more votes, the Wall Street Journal reports. Although it is adopting some Republican ideas, the White House hopes to win public support—and wavering Democrats—by painting the process as open and collaborative. Democratic leaders also expect some defections in the coming debate, especially among antiabortion Democrats who believe the Senate bill doesn't go far enough to limit federal funds from paying for abortions, the Journal reports.
Minnesota Gov. Tim Pawlenty and state Republican legislative leaders said they have produced a plan to break the impasse over providing health insurance for the state's poorest and sickest residents. To help repair a budget that's $1 billion out of balance, Pawlenty ended Minnesota's General Assistance Medical Care and moved recipients onto a program with less coverage and higher per-person costs. Pawlenty instructed the state Department of Human Services to shift about 32,000 current GAMC clients on April 1 to MinnesotaCare, an insurance program designed for lower-income working people and funded by premiums and a surcharge on healthcare providers and insurers. Legislative Democrats have hinted that GAMC advocates may file suit to block the program's elimination, the Minneapolis Star Tribune reports.
CMS has immediately suspended Fox Insurance Co. of New York from marketing and enrolling new members in its Medicare Part D prescription drug plan, after physicians and beneficiaries complained that Fox's drug plan hasn't met the prescription drug needs of some of its newest members.
"The plan has failed to fully meet its obligations to Medicare beneficiaries, particularly new enrollees, by failing to provide timely access to Part D drugs by imposing prior authorization and step therapy requirements that were not approved by CMS, not meeting the necessary appeals deadlines, and not meeting the requirements to transition new enrollees to the covered drugs," CMS said in a news release.
CMS learned of the problems from Fox drug plan members and their physicians, and will monitor the plan to determine that corrective actions have been taken. If Fox is not in compliance to Medicare requirements, CMS may fine or even terminate Fox's contract with Medicare, CMS said.
Fox was reportedly not compliant with Medicare coverage in areas that involved protected class drugs for the treatment of cancer, HIV/AIDS, seizure disorders, diabetes, and respiratory disease, CMS said.
Fox Insurance Co. did not return calls seeking comment Monday.
The Fox drug plan has members in Arkansas, Arizona, California, Colorado, Connecticut, Florida, Georgia, Hawaii, Illinois, Louisiana, Maryland, Missouri, North Carolina, New Jersey, New York, Nevada, Ohio, Pennsylvania, South Carolina, Texas, and West Virginia.
The Health Care District of Palm Beach County Board has approved the $250,000 bid to purchase the old Glades General Hospital on 14 acres in Belle Glade to Miami-based developers Castello Brothers, LLC.
"We are encouraged by the bidder's interest in developing new housing on the property, which would serve as a community resource and asset," Dwight D. Chenette, CEO of the healthcare district, said in prepared remarks. "The plans outlined by the bidder will put the property back on the tax rolls and may create additional jobs while renovations are underway."
Castello Brothers, which co-owns a 384-unit, multi-family Belle Glade Gardens development, said it will convert the Glades General Hospital property for residential use. The Castello Brothers' offer was the highest of two bids submitted in response to an invitation to bid issued in December. The healthcare district board approved the bid on Wednesday, and the deal is expected to close within the next two months.
Glades General Hospital served rural western Palm Beach County for more than 65 years before it shuttered on Oct. 15, when the county opened Lakeside Medical Center. The new 70-bed hospital is Palm Beach County's only public hospital.
Online job ads in many employment sectors across the nation dipped by nearly 67,000 listings in February and healthcare practitioners and technical occupations accounted for almost half of the decline, a new report shows.
The Conference Board's Help Wanted Online Data Series report, which tracks more than 1,000 online job boards across the United States, found that advertised vacancies for highly skilled healthcare practitioners and technical occupations, such as registered nurses and radiographic technologists, fell by 30,300 listings in February, for a total of 537,000.
Demand for healthcare support personal, such as dental assistants and home healthcare aides, also fell by 8,600 listing for the month, for a total of 110,700, the report shows.
"Contributing to this month's decline were fewer advertised vacancies for physical and occupational therapist assistants, mirroring the declines in the demand for practitioners in these areas," the report stated.
Demand in the healthcare labor market varies substantially from the higher-paying practitioner and technical jobs to the lower-paying support occupations. In January, advertised vacancies for healthcare practitioners or technical occupations outnumbered the unemployed looking for work in this field by more than 3 to 1, and the average wage in these occupations is $32.64/hour.
The average wage for healthcare support occupations is $12.66/hour and there were more than two unemployed people looking for work in the field for every advertised vacancy, the report said.
The dip of 66,900 online listings to 3.9 million in all job sectors in February follows an increase of almost 750,000 listings in the previous three-month period.
Recent declines in the number of unemployed coupled with the rise in the number of advertised vacancies has narrowed the gap between labor supply and labor demand by 1.5 million. In January, the latest month of unemployment numbers, there were 10.8 million or 3.69 unemployed for every online advertised vacancy, the report stated.
"Although labor demand dipped slightly, the large gains in the last few months have provided a positive sign of a turnaround in employer labor demand," said June Shelp, vice president at The Conference Board. "Currently, labor demand, as measured by online job postings, is close to the levels in November 2008, just prior to the huge losses from the financial crisis. The numbers indicate that the economy is recovering from the recession and companies are filling vacant positions, but it is still unclear if employers are willing to significantly expand their workforce."
Atlanta-based Mariner Health Care Inc., subsidiary SavaSeniorCare Administrative Services LLC, and their principals will pay the federal government and several states $14 million to settle kickback allegations, the Justice Department has announced.
Federal prosecutors alleged that the defendants solicited kickback payments from pharmacy giant Omnicare in exchange for agreements by Mariner and Sava to continue using Omnicare's pharmacy services for 15 years. In November, the federal government, several states, and Omnicare entered into a $98 million settlement that resolved Omnicare's civil liability in the investigation, according to the Justice Department.
"The allegations raised by the government concern a transaction that occurred before SavaSeniorCare commenced operations, and well before the current operations management team was in place," said SavaSeniorCare in a statement. "SavaSeniorCare did not contribute to the settlement amount. The company remains committed to providing quality care and services to more than 18,000 individuals every day."
Federal investigators alleged in a whistleblower suit filed last year that Omnicare, Mariner, Sava, and principals Leonard Grunstein, Murray Forman, and Rubin Schron arranged for Omnicare to pay Mariner and Sava $50 million in exchange for the right to continue providing pharmacy services to the nursing homes, which together constituted one of Omnicare's largest customers, according to the government.
They allegedly tried to disguise the kickback as a payment to acquire a small Mariner business that had two employees and was worth far less than $50 million. Investigators said Omnicare paid $40 million before acquiring the Mariner business. At the same time, Omnicare obtained 15-year pharmacy contracts from Mariner and from Sava, a new nursing home chain that Grunstein and Forman created from the Mariner chain, according to the Justice Department.
Prosecutors alleged that Grunstein and Forman illegally tied the new pharmacy contracts to Omnicare's purchase of the small Mariner business unit, and that the total $50 million purchase price for the business unit actually was a kickback by Omnicare to keep the future business of Mariner and Sava, according to the feds.
Approximately $7.84 million of the settlement will go to the federal government, while $6.16 million has been allocated to several state Medicaid programs that the federal government did not identify.
Federal prosecutors also alleged that after the government issued subpoenas about the transaction in 2006, the defendants created backdated documents to hide the kickback. "Kickbacks in all forms are insidious because they distort medical decisions affecting Medicare and Medicaid beneficiaries," said HHS Inspector General Daniel R. Levinson. "We will vigilantly scrutinize attempts to disguise kickbacks as legitimate business transactions and work to hold payers and recipients of kickbacks accountable."
Mariner has entered into a corporate integrity agreement with HHS, which retains the authority to exclude Sava, Grunstein, Forman, and Schron from participating in Medicare, Medicaid, and other federal healthcare programs.
The Feb. 15 early morning shooting inside the emergency department of Scotland Memorial Hospital in Laurinburg, NC, provides an unwelcomed, frightening, and extreme example of the violence that healthcare professionals too often confront.
If you want to read the details of the report, here's a local news link. Bottom line: some jerk allegedly brought a gun into a hospital and started shooting people. I really don't care what his motive was, although I was gratified—but not surprised—to read that the healthcare professionals on duty acted heroically to secure the safety of their patients.
When the attack was over, one patient at the hospital had suffered multiple critical gunshot wounds to the chest, his alleged attacker was in police custody, the hospital was in lockdown, and a number of healthcare professionals and their patients—though not physically injured-were badly shaken.
The story got little play nationally and not that much play around North Carolina—a couple of news cycles and then nothing. That left me wondering if hospital violence has become so commonplace that it no longer warrants extensive news coverage. Had a similar shooting occurred in a school, for example, it likely would have generated much more media coverage. Is this a sign that we are becoming inured to the idea of violence in the ED? Let's hope not.
From everything I've heard and read so far, it appears that Scotland Memorial CEO/President Greg Wood and his staff did a good job responding to the shooting, and then keeping the public informed. SMH issued two press releases in the hours immediately after the shooting—doing their best to explain the convoluted chain of events and the hospital's response, even as the police investigation was still underway.
"We have never experienced anything like this in our hospital before," Wood said in a media release. "The safety of our patients, visitors, and staff is of paramount importance to us, and we have extensive security measures in place to minimize the likelihood of such a horrific incident as this."
Wood understands the importance of keeping the public informed on this critical issue. He could have simply referred inquiries to the local police. You'd be amazed at how many hospitals do. SMH is still assessing its reaction to the shooting, what worked, what could be improved upon, etc. I hope to speak with Wood when that review is complete.
When will hospital violence get the attention it deserves? This is not a new phenomenon. HealthLeaders Media and other healthcare media have reported on it, but you don't see it talked about much anywhere else. An Emergency Nurses Association survey last year found that more than half of emergency nurses say they've been "spit on," "hit," "pushed or shoved," "scratched," and "kicked" while on the job. One in four of the 3,465 emergency nurses surveyed for Violence Against Nurses Working in U.S. Emergency Departments say they've been assaulted more than 20 times in the past three years, and one in five nurses have been verbally abused more than 200 times during the same period.
A report from the National Advisory Council on Nurse Education and Practice also found "considerable evidence that workers in the healthcare sector are at greater risk of violence than workers in any other sector." The report cites Bureau of Labor Statistics data which show that 48% of all non-fatal injuries from occupational assaults and violent acts occurred in healthcare and social services settings. BLS data also show that 9.3 in 10,000 employees in the health services sector suffer injuries that require time off from work, compared with two in every 10,000 workers overall in the private sector.
There are cost big factors at work here too. How much are hospitals paying in workers' compensation claims, or litigation for unsafe work environments, or for missed work, or for overtime or hiring temps to cover those missed shifts? How will a shooting in your emergency department affect recruiting and retention?
These are grave questions that deserve immediate attention. First and foremost, however, this is a human resources issue. This is about providing dedicated healing professionals with a safe working environment. They have enough stress in their work already. They shouldn't have to worry about getting shot, or stabbed, or kicked, or slapped, or scratched, or punched, or spit upon, or pushed, or cursed at, or intimidated. That sort of abusive conduct is not tolerated almost anywhere else. Why are hospitals the exception?
Note: You can sign up to receive HealthLeaders Media HR, a free weekly e-newsletter that provides up-to-date information on effective HR strategies, recruitment and compensation, physician staffing, and ongoing organizational development.
Insurance commissioners from three states today expressed concerns that health insurance reform proposals put forward by Democrats and Republicans would destabilize state markets and create more problems than they're designed to solve.
Specifically, three members of the National Association of Insurance Commissioners sharply criticized a Republican proposal to allow consumers and companies to purchase health insurance across state lines and a Democratic plan to strip health insurers of antitrust protections.
Rep. Marsha Blackburn, R-TN, said at the White House healthcare reform summit on Thursday that allowing consumers to purchase health insurance policies that are regulated in other states would spur competition and lower costs.
"State lines right now basically have stop signs up when it comes to across-state-line access," Blackburn said at the summit. Removing those barriers, she added, would lower costs and "insurance companies accountable."
NAIC President Jane Cline, insurance commissioner for West Virginia, told reporters Friday that insurance companies already operate in multiple states. However, they must comply with each state's regulations and coverage mandates.
Kansas Insurance Commissioner Sandy Praeger, who is also chair of the NAIC's Health Insurance and Managed Care Committee, says states have long opposed allowing the federal government to strip them of a critical oversight tool.
"We lose a lot in terms of consumer protections," she told reporters. "Companies will seek out the states that have the least amount of consumer protections in their state laws, file their products there, get them approved, and then come back into my state."
Praeger says a federal mandate to strip states of the right to regulate policies and mandate coverage would likely have fewer benefits, and would thus be cheaper.
"Who do those appeal to? Younger healthier folks, people who don't think they need much insurance, but want some protections," she said. "That means the people who want comprehensive coverage will buy from our state-regulated plans, which will ultimately cost more."
"We are there to protect the market and to keep everyone playing by the same rules. This destabilizes and allows for adverse selection and cherry picking," she said.
Oklahoma Insurance Commissioner and NAIC Secretary-Treasurer Kim Holland said the Republican idea would overrule the democratic process that state legislatures have used to respond to the requests of their constituents.
"There are regions of this country where legislatures have passed a lot of laws to require insurers to cover various services that their constituents are demanding. That contributes to cost," Holland said. "We have to ask ourselves 'are there ways we can insure the appropriate consumer protections we all want while still allowing some flexibility for those folks who are simply priced out of the market?'"
The commissioners also reiterated their opposition to a bill pushed by Democrats that would strip health insurance companies of antitrust protections under the McCarran-Ferguson Act of 1945. The bill overwhelmingly passed the House on Wednesday by a 406-19 vote. A related bill is in the Senate Judiciary Committee. Democratic sponsors say the bill would increase competition among health insurance companies, and thus lower costs. The commissioners say it will do neither.
Praeger says the antitrust exemptions allow smaller health insurance companies to tap into new markets using the aggregated claims experience data of larger competitors.
"That helps them determine their potential risk going forward and helps them price their products," Praeger says. "The jury is still out on whether or not they would be allowed to do this—but we think that would give the larger companies a big advantage and make it more difficult for smaller companies to appropriately price their products. That could potentially cause more market consolidation and limit the competitiveness of the market."
Holland said antitrust protections stabilize state health insurance markets.
"If you have not been here before, you have no history or background on what general losses might be, demographics, or a variety of different information that might assist you in appropriate pricing," she says. "What we don't want is companies coming in and under-pricing their products because it could lead to a solvency concern."
Holland said the antitrust protections promote competition.
"Companies are able to come in with some reasonable assurance of pricing products effectively and then compete on that basis without disrupting the market with inadequate pricing that could have the unintended consequence of a solvency problem," she said.
The commissioners also rejected Democrats' claims that stripping the antitrust protections would stop price fixing and collusion among health insurance companies.
"We currently have laws that we can enforce if we thought that was going on, through our attorney generals, through our insurance departments," Praeger said. "That is a consumer protection issue that we regulate now."
If there were evidence that health insurers were in collusion, Holland said state insurance commissioners would work together to investigate.
"Insurance commissioners across the nation share information. We collaborate on many concerns," Holland said. "We recognize that the large companies that are doing business in many states that would most benefit from some action of that nature would be operating in most of our states. If we were concerned about that in one state, we would share that information with each other and pursue it collectively. That issue has not risen."
Martin Memorial Medical Center in Stuart, FL, has disciplined several employees for taking cell phone pictures of a shark attack victim who later died, and has asked anyone with copies of the photos to destroy them.
The disciplinary actions included written warnings, suspension, and demotion to loss of position, but nobody was fired, the hospital said in a media release. "Ultimately, we have determined that these inappropriate actions were taken by good people who exercised poor judgment," said the hospital in a prepared statement.
Martin Memorial began an internal investigation after hospital officials were told that employees may have violated HIPAA privacy laws involving Stephen Schafer, who died after a Feb. 3 shark attack at Stuart Beach. The hospital said that Schafer's family has been apprised of the privacy breach throughout the investigation.
"Our investigation revealed that cell phones were used to take photographs of Mr. Schafer's injuries by individuals who were in the emergency department at that time," the hospital statement said.
"Because hospital emergency departments are extremely busy, often filled with a variety of individuals—ranging from patients, visitors, physicians, staff, volunteers, students, fire-rescue personnel, and law enforcement—we made a concerted effort to complete a comprehensive investigation and sought as much information as possible from a variety of sources."
"Out of respect for the Schafer family we have asked that all individuals involved in this incident destroy or eliminate any remaining photos and would ask the same of anyone in this community who may happen to come across a photo," the statement read.
Martin Memorial is also investigating reports that people not employed by the hospital were directly involved in the picture taking. "We are following up with the organizations they represent," the statement read.
Citing internal personnel policies, the hospital wouldn't identify the number of people involved in the picture-taking, the names of the employees who were disciplined, their job titles, the organizations they represent, nor what specific actions were taken.
Martin Memorial has started a re-education and re-training program on patient privacy laws and cell phone usage for physicians, staff, and outside personnel working in the hospital.
